Azerbaijan proposes Global Islamic Climate Finance Alliance

A proposal to establish a Global Islamic Climate Finance Alliance (GICFA) has been put forward on the sidelines of the 51st Annual Meetings of the Islamic Development Bank (IsDB) Group in Baku, Azerbaijan.

The new multilateral international platform is designed to unite Islamic and climate capital markets, facilitating more effective mobilisation of financial resources for environmental and climate-related projects, Caliber.Az reports, citing local media.

The proposed alliance is expected to serve as a platform for strategic partnerships, knowledge exchange, and the sharing of best practices, as well as cooperation between investors, financial institutions, and project developers.

Participants at the IsDB Group annual meetings also called for stronger cooperation to better harness the potential of Islamic finance in supporting environmental initiatives, achieving the Sustainable Development Goals (SDGs), and financing the energy transition.

Experts noted that despite the significant scale of the Islamic finance industry and its alignment with sustainability principles, its contribution to green financing and the energy transition remains below its potential. Discussions highlighted existing barriers between investors, developers, and implementers, as well as the need for closer coordination among stakeholders.

The conclusions of the discussions were reflected in the Baku Communiqué, a strategic document that will outline further steps to expand the role of Islamic finance in strengthening climate resilience and supporting the global energy transition.

By Bakhtiyar Abbasov